Non Prosecution Agreement (NPA) under the Foreign Corrupt Practices Act (FCPA) is an important legal instrument that helps companies to resolve charges of violating the FCPA without facing criminal prosecution. In this article, we will explore what NPA is, how it works, and its importance for companies operating in the international arena.
What is a Non-Prosecution Agreement?
A Non Prosecution Agreement (NPA) is a legal instrument that is used by the US Department of Justice (DOJ) to settle cases related to FCPA violations. An NPA allows a company to avoid criminal prosecution in exchange for certain undertakings. Under an NPA, the DOJ agrees not to prosecute a company for criminal offenses if the company agrees to take certain actions. These actions may include paying fines, disgorgement of profits, cooperating with the DOJ’s investigation, and implementing compliance measures to prevent future violations.
How Does an NPA Work?
When a company is suspected of violating the FCPA, the DOJ may launch an investigation. If the investigation finds evidence of a violation, the DOJ may bring criminal charges against the company. However, before the DOJ brings charges, it may offer the company the option of entering into an NPA. If the company agrees to the terms of the NPA, the DOJ will not prosecute the company.
The terms of an NPA may vary depending on the circumstances of the case. However, in general, an NPA requires the company to agree to cooperate with the DOJ’s investigation, pay a fine or disgorgement of profits, and implement compliance measures to prevent future violations. Compliance measures can include hiring a compliance officer, conducting regular training sessions for employees, and implementing internal controls to prevent bribery and corruption.
Why is an NPA Important?
For companies facing FCPA violations, the option of entering into an NPA can be beneficial. By entering into an NPA, the company can avoid the negative consequences of a criminal prosecution. Criminal prosecutions can result in significant fines, damage to the company’s reputation, and even jail time for company executives. An NPA can also help companies avoid the costly and time-consuming process of defending a criminal trial.
Moreover, entering into an NPA can help companies regain the trust of their stakeholders. FCPA violations can damage a company’s reputation and lead to a loss of business. By entering into an NPA and implementing compliance measures, the company can show its commitment to ethical business practices and regain the trust of its stakeholders.
Non Prosecution Agreement (NPA) is an important legal instrument that helps companies to resolve cases related to FCPA violations without facing criminal prosecution. By entering into an NPA, companies can avoid the negative consequences of a criminal prosecution, regain the trust of their stakeholders, and show their commitment to ethical business practices. As such, companies operating in the international arena should be aware of the benefits of NPA and take steps to implement compliance measures to prevent FCPA violations.